Update: PDC rejects settlement in case involving liberal ousting of conservative Democratic senator

Statement hints that primary election results could be overturned.

Statement hints that primary election results could be overturned.

UPDATE 11:50 a.m.: Here's what the Public Disclosure Commission's spokeswoman says the Commission specifically decided this morning in this case: "The Commission rejected the stipulation (settlement agreement) and voted 3-0 to ask the Attorney General to prosecute Moxie Media.  They will recommend that the Attorney General explore all remedies, including those allowed by RCW 42.17.390.  That statute sets out when a court may overturn an election."

UPDATE (11:30 a.m. Thursday): The Public Disclosure Commission has rejected a staff-recommended settlement deal with Lisa MacLean and Moxie Media. The case will now be forwarded to the Attorney General for further investigation. PDC staff had recommended a $30,000 fine. But the commission didn't feel that was adequate. Commissioner Jane Noland called the alleged actions by MacLean "reprehensible" and said they made a "mockery" of Washington's campaign finance disclosure law. Sen. Jean Berkey, who lost the primary race by just 122 votes, wants a special election called in the 38th District. MacLean's attorney said he was "not surprised" by the commission's decision. (Although a quote in the story refers to one political action committee being established, two PACs were actually established by Lisa MacLean.)

This blog post is based on an extensive PDC report and emails the PDC obtained during its investigation. Lisa MacLean of Moxie Media denies wrongdoing. The groups involved and named here have not been implicated by the PDC.

Just in time for Halloween, Washington's Public Disclosure Campaign issues a damning 130-page report about traditionally Democratic organizations dressing up like Republicans in a Machiavellian scheme to knock off a conservative Democratic State senator who, apparently, had done them wrong.

The upshot of the 130-page report is that a Seattle-based political consultant allegedly shuffled campaign donations through several Political Action Committees (PACs) in an effort to conceal the backers - labor unions and trial lawyers - of a stealth "attack from the right" on Senator Jean Berkey during last August's primary election.

At the center of the case is Moxie Media founder Lisa MacLean whose firm specializes "in direct mail, internet advertising and print advertising for Democratic candidates, progressive ballot proposition campaigns, and other issues," according to the PDC.

The PDC alleges MacLean concealed and failed to report $9,000 in contributions in violation of Washington campaign finance law. MacLean is also accused of registering Political Action Committees without using her own name. An enforcement hearing is scheduled for today (Oct. 28), but a settlement deal may be in the works. MacLean denies the charges.

Nine-thousand dollars is chump change in politics. But the story behind this particular $9,000, as told by the PDC and outlined in emails, is bizarre and sordid.

It begins last August, just before the primary, when Republican voters in the 38th Legislative District (Snohomish County, including Everett and Marysville) started receiving robocalls and mailers attacking incumbent Democrat Berkey for voting to suspend the two-thirds requirement for tax hikes and then voting to raise taxes.

"When times are this tough ... The last thing we need is higher taxes," read one of the postcards paid for by the Cut Taxes PAC. The calls and postcards urged a vote for Republican candidate Rod Rieger.

Turns out, this pro-Republican campaign was actually a stealth effort funded by traditionally Democratic interests: the Washington Federation of State Employees, the Washington State Labor Council, and trial lawyers.

These power players didn't really want Rieger elected. But they did want Berkey to come in third place in the top-two primary. That way she'd be out of the way. That would give their chosen candidate — a liberal Democrat named Nick Harper — a better shot at winning the seat in November. The strategy appears to have worked. Berkey lost the primary and promptly filed a complaint with the PDC and the Attorney General.

According to the PDC's report and email evidence, MacLean hatched the idea of "attacking Senator Berkey from the right."

In an Aug. 4 email to numerous labor groups, MacLean wrote: "We need $9,000 to pull this off. This ... is good insurance in a race we DO NOT want to see back in the general election."

Then she outlined a strategy for keeping the campaign's true funders secret — at least until after the primary election:

"(The campaign) will be paid for by Cut Taxes PAC with sole Top 5 contributor being Conservative PAC. This would not show up at the PDC until 8/11 ... and it would likely take much longer for any reporter or blogger to link it to any of you before election day."

Within a couple of hours the Labor Council's DIME PAC, the Federation, and the trial lawyer-backed Forward PAC were onboard. MacLean wrote in an email: "okay we are funded at $9K thanks to DIME, WSAJ and WFSE. Thanks!"

The plan was to send out two mailers and one robocall to five-thousand households. Time was of the essence.

On Aug. 5, a day after the funding was secured, MacLean sent an email to representatives of each group (Kathy Cummings at WSLC, Cody Arledge at WFSE, and Michael Temple at Washington State Association for Justice) that said: "Need your sign-off ASAP today on these two mail pieces. Please remember that we are simulating crappy GOP mail."

Adam Glickman of SEIU Local 775 was also looped-in. His union was active in the 38th District race, but not funding this particular effort. At one point Glickman questioned why MacLean was planning to set up a brand new PAC, "Cut Taxes," when "Conservative" PAC already existed.

MacLean's response is what you might call the "smoking gun" in the case:

"I am trying to provide as much cover to funders as possible. And don't want funder names on pieces as top 5 contributors. funder money will not move until after the primary. the expenses for these pieces and the auto-call will be listed only as debts (in Moxie Media's PDC reports)."

PDC investigators note that: "Ms. MacLean appeared to discount the requirement of political committees to report contributions pledged but not yet received."

On Aug. 10 and 11, the anti-Berkey/pro-Rieger postcards were mailed. On Aug. 13 the robocalls began. Voters who got the call heard this:

"Hi this is your neighbor, Emma. I'm a lifelong Republican and I vote in every election, but every once in a while I vote for a conservative Democrat. Four years ago I voted to re-elect Democrat State Senator Jean Berkey. But this year things in Olympia have just gotten so bad. Luckily we have a good Republican candidate to support. Rod Rieger will fight to hold the line on taxes in the Legislature...."

The voice on the call? None other than Lisa MacLean. She told PDC investigators that she played the part of "Emma" on the robocall.

The call ended with this statement recorded by MacLean's business partner: "No candidate authorized this ad. It is paid for by Cut Taxes PAC, Everett, Washington. Top five contributors: Conservative PAC."

MacLean defended her actions to PDC investigators. They write in their report that MacLean "felt there was a lack of consensus among the funders, and that the arrangement was tentative and fuzzy. She said she felt that the most forthright, accurate way to disclose the sponsorship of the communications was as a debt to Moxie Media."

In response to the PDC's complaint MacLean writes: "(Moxie Media and the PACs) have not concealed or sought to conceal the source of any contributions ... Moxie was simply unable to overcome all of the political, practical and logistical obstacles."

MacLean emailed me to say she will issue a statement after Thursday's disciplinary hearing. Same for the Washington State Labor Council. The Washington Federation of State Employees did not return my call.

I did speak with Larry Shannon, government affairs director at the Washington State Association for Justice. He says the decision to participate in this campaign was made by a contract lobbyist. Shannon says he purposely steers clear of his organization's involvement in independent campaigns because he works directly with candidates. State law prohibits any coordination between the two.

That said, Shannon vows to make sure "we're never involved in a project like this again" (i.e. a stealth attack from the right). He says it's a matter of credibility for his organization. Shannon adds "we could never, ever condone" concealing or delaying campaign contributions.

I also spoke with former Democratic Party Chair Paul Berendt, now a political consultant himself. He didn't mince words. "Outrageous" is how he describes the stealth attack on Berkey. "I think it's sleazy, I think it's a new low in politics."

This story originally appeared on the writer's blog, WaLedge.


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